Landlords want to ensure that they choose tenants that are reliable and unlikely to cause problems, such as late rent, damage to the property, or disturbances. One of the key parts of your tenant screening process should be a tenant background check. But why is the background check so important? What information are you looking for in a background check?
What Tenant Background Checks Show
Tenant background checks offer you a way to screen your potential tenants and spot any potential red flags. Your background check will show slightly different information depending on what you look for, but all will confirm that the tenant is who they say they are. They will also usually check for any criminal history, including at the federal, state, or county level. Most background checks also confirm that your potential tenant is not on a global terrorist watchlist or the sex offender registry and that they have not had any past evictions.
What You Need for a Tenant Background Check
Before you get started with the background check, make sure that you have written consent from the potential tenant to complete it. You will also need their social security number, name, address, and birth date.
With that information in mind, why is it so important to complete a tenant background check?
Finds Tenants With Legitimate Interest
Most credit checks carry fees, and it is common for landlords to pass those fees onto the rental applicants. This standard practice not only helps you keep costs down, but it also helps you weed out potential applicants who are not actually interested in your property. If someone is willing to pay for a background check, they are likely genuine about wanting to rent your property, reducing the chances of them wasting your time.
Of course, you can also opt not to charge tenants directly for a background check. In this case, you may include it in a general application fee, which serves the same purpose.
Provides Peace of Mind for Safety
As a landlord, you are likely to have to interact with your tenants occasionally to regularly. You want to feel safe in all of these interactions and a background check can give you peace of mind in that respect. This is particularly important for those times when you have to have a tough conversation with a tenant, such as about raising the rent or damage to the property. In those scenarios, you will likely feel a lot safer going into the conversation if you know they have no charges for violence or threats.
Ensures Legal Compliance
Conducting a background check can also help you ensure that you do not accidentally violate any laws. For example, if your property is within a certain distance of a school, you would want to confirm you do not rent to sex offenders, as this would be illegal.
Reduces the Risk of Problems
By completing a background check on tenants, you also dramatically decrease the chances that your tenants will cause problems. Remember that if a tenant commits a crime on your property, you may still get in trouble for negligence.
Just keep in mind that if you deny tenants’ applications due to criminal history, you must prove that this is for the safety of the community and property. This is to avoid the risk of discrimination.
Background checks for tenants also help promote honesty. If there is something potentially concerning in their past and they know you are running a background check, tenants are more likely to let you know about it. After all, it will reflect poorly on them to hide information only for you to discover it.
Simply put, tenant background checks protect your property and reduce the risk of issues in the future.